The impact of board characteristics and CEO power on banks’ risk-taking: stable versus crisis periods

Fernandes, Catarina; Farinha, Jorge; Martins, Francisco Vitorino; Mateus, Cesário

doi:10.1057/s41261-021-00146-4

Cited by 14 publications

(17 citation statements)

References 83 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Regarding the composition of the board, the Bindp*CCI interaction term was positive and significant (0.61, p < 0.01). These results corroborate those of Fernandes et al ( 2021 ), Gilani et al ( 2021 ), and Trinh et al ( 2021 ). In addition, the effective control of corruption in banking institutions increases the position and power of women on the board ( Bfemle*CCI ), which promotes and enhances banking stability (0.25, p < 0.01) (Marie et al 2021 ).…”

Section: Resultssupporting

confidence: 92%

“…More recently, Ghosh ( 2018 ) shows that greater board independence is essential not only to further enhance profitability but also to reduce the insolvency risk within banking institutions. More recently, Fernandes et al ( 2021 ), Gilani et al ( 2021 ), and Trinh et al ( 2021 ) confirm that board independence is positively associated with banking stability. Thus, our second hypothesis predicts a positive relationship between the presence of independent directors on a board and banking stability.…”

Section: Theoretical Framework and Development Of Hypothesesmentioning

confidence: 96%

“…In all countries worldwide, the main objective of banking institutions is to establish a strong board of directors system that aims to improve corporate governance by setting standards for the size, composition, structure, and responsibilities of board members. Following previous studies examining the impact of the board of directors on banking stability (Karkowska and Acedański 2020 ; Fernandes et al 2021 ; Gilani et al 2021 ; Marie et al 2021 ), this study considers the attributes of the board of directors, including board size, board independence, board diversity, board duality, and number of board meetings.…”

Section: Theoretical Framework and Development Of Hypothesesmentioning

confidence: 99%

See 2 more Smart Citations

Impact of board of directors on insolvency risk: which role of the corruption control? Evidence from OECD banks

Sallemi

Hamad²,

Ellili

2022

Rev Manag Sci

View full text Add to dashboard Cite

This study examines the relationship between corporate governance and banking stability by considering the moderating role of corruption controls. This study applies the Generalized Moments Method using a sample of panel data collected from 74 banks in 10 Organization for Economic Co-operation and Development countries during the period 2006–2016. The empirical results reveal that banking governance is positively associated with banking stability as measured by the Z-score. Additionally, the findings indicate that effective corruption control significantly moderates the power of the board of directors in boosting banking stability. This study discerns the fundamental role of the board of directors as the main corporate governance mechanism and internal player in the stability of banking institutions.

show abstract

Section: Resultssupporting

confidence: 92%

Section: Theoretical Framework and Development Of Hypothesesmentioning

confidence: 96%

Section: Theoretical Framework and Development Of Hypothesesmentioning

confidence: 99%

See 1 more Smart Citation

Impact of board of directors on insolvency risk: which role of the corruption control? Evidence from OECD banks

Sallemi

Hamad²,

Ellili

2022

Rev Manag Sci

View full text Add to dashboard Cite

show abstract

“…The research results conducted by Bhatt & Bhatt (2017) explain that governance, which is proxied by board size, has a significant effect on performance, including the risk. Fernandes et al (2021) conclude that different governance characteristics have different relevant for banks' risk-taking continget on the economic environment being one of stability or crisis. Meanwhile, we have substantial evidence that board age impacts performance, and the hypothesis for directors' age proxy of governance is accepted.…”

Section: Resultsmentioning

confidence: 89%

Governance and Bank Performance: Do Bank Risk Matter ?

Widarwati¹,

Karmila²,

Nurmalasari³

2022

Etikonomi

View full text Add to dashboard Cite

Governance becomes a guideline for the banking management system and is essential for banking survival during regular economic crises. We investigate the impact of governance on performance in the Indonesians' conventional and examine the mediating role of bank risk in bank governance and performance relationship. The samples are 18 conventional banks listed on Indonesia Stock Exchange (IDX) from 2014 to 2021 and analyzed using panel data regression and sobel test. We find the risk of state-own bank higher than private bank and foreign bank that could leads to lower performance. Then the results indicate that board size and board age influence bank risk and bank performance. Banks should consider the board size for efficiency and also the maximum standard of their directors' age based on arguments related to innovation-based work productivity in the competitive banking industry. The subsequent exploration of banking governance research is needed by examining the differences in bank ownership and bank characteristics linked to bank risk which is strong evidence as mediation in this study.JEL Classification: G20, G30, G32, G34

show abstract

“…De Araujo and Leyshon’s study [ 29 ] reveals a window in content relevancy of disclosures as depositors and creditors are most responsive to information such as the bank’s assets, off-balance sheet items, and ratings for other banking activities. Stakeholders value the quantitative information more than the qualitative one and can positively influence bank risk-taking [ 30 ]. Additionally, website disclosures are a timely disclosure medium and rich form of communication available to a broad range of stakeholder groups [ 31 ].…”

Section: Literature Reviewmentioning

confidence: 99%

Pillar 3: Does banking regulation support stakeholders’ interest in banks financial and risk profile?

et al. 2021

View full text Add to dashboard Cite

The paper examines the interest of the commercial banks’ stakeholders in Pillar 3 disclosures and their behaviour during the timing of serious market turbulence. The aim is to discover to which extent current banking regulation supports stakeholders’ interest in the information required by regulators to be disclosed. The examined data consists of log files that were pre-processed using web mining techniques and from which were extracted frequent item sets by quarters and evaluated in terms of quantity. The authors have proposed a methodology to evaluate frequent item sets of web parts over a dedicated time. Based on the verification of applied methodology on two commercial banks, the results show that stakeholders’ interest in disclosures is highest in the first quarter at each year and after turbulent times in 2009 their interests decreased. Moreover, the results suggest that stakeholders expressed higher interest than in regulatory required Pillar 3 information in the following group of information: Pillar3 related information, Annual reports, Information on Group. Following our results, the paper contributes to cover the gap in the research by analysing Pillar 3 disclosures and their compliance with regulatory requirements, which also increase the interest of the relevant stakeholders to conduce them as an effective market discipline tool.

show abstract

The impact of board characteristics and CEO power on banks’ risk-taking: stable versus crisis periods

Cited by 14 publications

References 83 publications

Impact of board of directors on insolvency risk: which role of the corruption control? Evidence from OECD banks

Impact of board of directors on insolvency risk: which role of the corruption control? Evidence from OECD banks

Governance and Bank Performance: Do Bank Risk Matter ?

Pillar 3: Does banking regulation support stakeholders’ interest in banks financial and risk profile?

Contact Info

Product

Resources

About